Discuss the job pre-need:
Hopefully you will not be surprised you were given this job. Hopefully the person who so appointed you asked your permission before doing so. Ask this person to prepare a list of assets and accounts for you. If not given to you, you should know where in the house to find it. My dad kept his on a computer and in a fireproof box. This list should include:
- Bank Accounts: At least the names of the bank(s); preferably account numbers as well;
- Investment Accounts: Account numbers, holders, websites, passwords. Everything the executor/trix needs to find all the money
- List of Real Estate Holdings: If there is rental property, a copy of all leases, or at the least, the amount of rent due, and from whom; or if a mortgage is held, the name of the debtor, amount due and date due;
- List of all regular bills: This is particularly important if they are paid automatically electronically. It allows the executor to quickly shut off unneeded things (like NetFlix) while making sure the power bill is paid.
- List of known debts: Creditors have first rights to an estate. Mortgages should be on this list as well as any other long-term debt.
- Insurance Agent: It is going to take time to wrap things up and the decedent's homeowner's insurance can be kept in effect during that time. If there is life insurance, the executor needs to know about it so it can be claimed.
- Funeral/Burial Choices: Especially if there may be disagreement among the heirs about the type, location or price of the funeral, having in writing what someone wants can reduce contention
- Digital Information: Having access to email and/or facebook accounts makes it easy to notify those important to the decedent about his/her death. However the decedent needs to realize that giving out those passwords may give out secrets s/he would rather keep. However, people should give serious consideration to giving the executor/trix access to photo accounts such as Google Photos, Flikr, or Amazon.
- Business Information: If the person owns a business, with employees, those employees will need to be paid. If the business is a sole-proprietorship (not a corporation or LLC), the business will die with the owner, even if the name and everything else is sold or passed on to heirs. You need to know where to access any payroll records and tax records, as well as any information needed to keep the business running (if possible) until plans can be made for its future:
- Location of last year's tax return or name of tax preparer. As executor/trix you will be responsible for filing the decedent's final tax return. Having the prior return helps.
- If the will contains any surprises, an explanation: I think most children expect to share equally in their parents' estate with their siblings. If one sibling for some reason is getting substantially more or substantially less than others, a written explanation from the parent may help avoid a court fight (but don't count on it).
Take a Deep Breath
There is very little that has do be done immediately, other than the funeral. Get through that, and allow yourself to mourn.
Notify Those Who Need to Know:
If the decedent was receiving any kind of pension or government aid, those agencies need to be notified of the death. While the funeral home may notify Social Security, you need to cut off any military pension, VA benefits, or corporate pension. If the decedent had life insurance, a claim must be made. If the decedent had minor children, Social Security should be notified so benefits can be paid to the children.
Gather the Paper:You are going to need a Death Certificate (the funeral home will order these, and you only need a few; most banks etc. today will take a scanned copy), and a list of assets and a copy of the will.
Hire an Attorney
Unless you have no money and the decedent had no money, hiring an attorney is the smart thing to do. Yes, you can probably find all the forms you need online or at the library at the local courthouse, but this is one of those cases where it can be expensive to fix something that could easily have been done right in the first place had you hired the right person. Give some thought to the expected size of the estate, the expected complexity of the estate and the expected problems (or hopefully lack thereof) with the heirs before hiring an attorney. You don't need the guy in the corner office of a fancy firm in a high-rise building to handle passing a house and bank account from the surviving parent to siblings who get along. However, if the will includes trusts, ongoing business interests, and multiple families, and substantial assets, that may be the person to hire. Call the local bar association or use Google to find local attorneys who specialize in estates. The outside of their office should give you some clue about where they rank fee-wise. Most will give you a quote after the initial consultation (which should be complimentary) and will give you a general idea of what will happen and when it will happen.
Open a Bank Account for the Estate
The attorney will likely advise you to open a bank account for the estate. While Louisiana is different, in most states there is an initial round of paperwork followed by several months of probate--a waiting period during which creditors can make their claim. After the initial round of paperwork, you will be given a document to take the the bank to claim the money for the estate. That money cannot be distributed to the heirs at this point (unless it is a pay on death account) but can be used to pay the bills of the decedent or the expenses of the estate (like keeping the lights on in the house). This account is also where you deposit money owed to the decedent or the estate (like rent collected from tenants).
Manage the Affairs of the Decedent
You are now authorized to financially act as the decedent would. You can collect debts and you have to pay bills. You have a fiduciary duty to act in the best interest of the estate so as to maximize recovery for creditors and to provide as much as you can to the heirs. If the house needs to be sold, you have to hire the real estate agent or otherwise arrange for it to be sold. If one of the heirs wants it and it was not specifically willed to that person, you need to figure out how to make the other heirs whole, whether is by that person paying the estate for other shares or by that person taking less of the pot--or whatever other way the heirs agree.
Communicate with the Heirs Early and Often
Hopefully, you will be in a position shortly after the funeral to get a basic handle on the decedant's financial state. You may not know it down to the penny, but you should be able to say "Dad had money in the bank, but the medical bills are really high and they just keep coming" or "Mom had a reverse mortgage on the house and almost no money in the bank" or "It looks like we are each going to get about $$. Send everyone an email every month or two about the status of things; how much money did you spend, how long will it be etc.
Talk to the Heirs About the "Stuff"
|While scanners mean that we don't have to fight |
over old family photos anymore
there may be something that everyone wants.
Follow the Lawyer's Instructions
Hopefully you picked a lawyer who has done this before and can tell you what to do to gather the assets. On the other hand, you can ask the attorney to do it for you. It all comes down to the amount of trouble involved, and how much you want to pay the lawyer vs how much you'd rather do yourself.
Complete the Final Tax Return
You can do this yourself, or use money from the estate to hire someone to do it for you.
Distribute the Assets
Hopefully this is no harder than writing a check. The reality is, when heirs fight over an estate, the only winners are the lawyers.
Have you ever served as an executor/executrix? Do you have any advice for those who may get this job in the future?